BUSINESS leaders have slammed the revelation that Boston Borough Council spent the equivalent of almost 40 per cent of its council tax precept on employee pension contributions in the last financial year.

New research published by the Federation of Small Businesses (FSB) has revealed that pension contributions cost the authority £1.314-million in 2008-9.

This figure equates to 38.1 per cent of the £3.449-million the council received in council tax payments.

FSB Wash branch chairman Kevin Mothers told the Target: "It is an absolute disgrace that, at a time when the economy is in dire straits and when most of us are facing reductions in our income and our living standards, that the equivalent of nearly 40 per cent of the money which hard-up taxpayers are being forced to contribute is going to fund lavish pensions for the privileged employees of the council.

"Every year we are being asked to pay more and more in our council tax, yet the services which we are receiving are going down and down. Now we know why that is.

"The public sector has a Rolls Royce pension plan when we, the public, can only afford a Ford Fiesta."

Council portfolio holder for financial management Cllr Richard Lenton said: "The level of pension commitment is historic and something this administration has inherited.

"This is an enormous problem, not just locally, but nationally, and is unsustainable.

"Historically the public sector had low wages, but offered security and good pensions. That all changed in 2003 when salaries shot through the roof.

"For the future it needs tackling urgently by the Government. The public sector now consumes more than half of our gross domestic product.

"Public sector wages need pulling into line with the private sector and that will begin to help with pensions. It cannot be painless. Boston Borough Council is aware that residents are struggling at this time and that is why we have continued to have no increase in council tax."

Meanwhile, councillors confirmed the authority's 1.1 per cent increase in its council tax precept for 2010-11 at a meeting on Monday.

Cost-cutting plans to mothball the Haven Gallery and the Wide Bargate public toilets for two years were also approved.